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Challenges in Our World Extremes of wealth (few) and poverty (many) “There should exist among the citizens neither extreme poverty nor again excessive wealth, for both are productive of great evil”- Plato 2500 yrs ago Serious ecological degradation

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How to Overcome the Challenges? 1.Incorporate points of views of different stakeholders, 2.Broaden the objectives of the companies to go beyond the economic.

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What is Corporate Social Responsibility (CSR)? "A concept whereby companies integrate social and environmental concerns in their business operations and in their interaction with their stakeholders on a voluntary basis.” European Commission. 2001. Green Paper: Promoting a European framework for corporate social responsibility

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“We define CSR as business' commitment to contribute to sustainable economic development, working with employees, their families, the local community, and society at large to improve their quality of life. ” What is Corporate Social Responsibility (CSR)? World Business Council for Sustainable Development

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The business contribution to sustainable development which has been defined as “development that meets the needs of the present without compromising the ability of future generations to meet their own needs”, and is generally understood as focussing on how to achieve the integration of economics, environmental, and social imperatives. What is Corporate Social Responsibility (CSR)? Industry Canada

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Why CSR? 1.Moral obligation - to do the “right thing” – to respect ethical values as well as people and the environment 2.Sustainability – “meeting the needs of the present without compromising the ability of future generations to meet their own needs.” 3.License to operate – the permission from government and people to carry on business 4.Reputation – the enhancement of corporate image and brand value Michael Porter

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Business in Society Ever-widening range of environmental, social and governance issues Adopting corporate citizenship practices to ensure sustainability Open and accurate communication on progress Partnership and collaboration of stakeholders, society and labour The role of investors and the finance community Alignment with international standards

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Triple Bottom Line… Environmental: Compatibility between the activities of companies and the sustainability of ecosystems Social: Social consequences of the activities of companies for all the communities concerned Economic: Conventional financial performance, but also the ability to contribute to the economic development of the corporate operating area and stakeholders

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The UN Global Compact's ten principles in the areas of human rights, labor, the environment and anti-corruption enjoy universal consensus and are derived from: The Universal Declaration of Human Rights The International Labor Organization's Declaration on Fundamental Principles and Rights at Work The Rio Declaration on Environment and Development The United Nations Convention Against Corruption What is Global Compact (GC)?

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UN Global Compact - HR Principle1: Businesses should support and respect the protection of internationally proclaimed human rights; and Principle 2: make sure that they are not complicit in human rights abuses.

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UN Global Compact - Labor Principle 3: Businesses should uphold the freedom of association and the effective recognition of the right to collective bargaining; Principle 4: the elimination of all forms of forced and compulsory labor; Principle 5: the effective abolition of child labor; and Principle 6: the elimination of discrimination in respect of employment and occupation.

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UN Global Compact – Anti-Corruption Principle 10: Businesses should work against corruption in all its forms, including extortion and bribery.

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Adopting an established and globally recognized policy framework A platform to share and exchange best and emerging practices The opportunity to advance sustainability solutions in partnership with a range of stakeholders, The opportunity to link business units and subsidiaries across the value chain with Global Compact Local Networks around the world Access to the UN's extensive knowledge of and experience with sustainability and development issues. Utilizing Global Compact management tools and resources, and the opportunity to engage in specialized workstreams in the environmental, social and governance realms. Benefits of Participation in the GC

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National Infrastructure Plan Development of sustainable development criteria High level screening studies Layout options for future developments Determination of the potential change in the economic value of ecosystem’s goods and services Identification of new major rail corridors

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Background The oreline is a the export corridor (~863 km of rail line) connecting the iron ore mines in the Northern Cape of South Africa with the Port of Saldanha in the Western Cape Saldanha Bay is a natural deep water bay constructed in 1976 and the towns in its immediate vicinity has grown alongside its development The closer proximity of residential development and the property boom in coastal towns in South Africa led to more conflict between communities and the port as a result of dust Some houses in the immediate vicinity has been stained with a red to pink discolouration due to iron ore dust fallout Since 2000, the capacity of the exports have grown from 38 Million tons per annum and new mines are establishing with a view of utilising the link Future projections are to increase export to ~100 million tons per annum (MTPA) HMG were involved in conceptual studies for future expansions as well as execution of current expansion up to 60 Mtpa through various phases

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Phase 1A –Installation of dust mitigation measures to reduce fallout dust and particulate matter in the surrounding environment –Management of long term air quality monitoring in surrounding environment in order to determine standards for iron ore dust fallout and to monitor the port’s performance against increase in export volumes –Estimating and planning of compensation for surrounding land owners affected by iron ore dust staining

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Phase 1B –Expansion of port facilities to handle 47 Mtpa (from 38 Mtpa) of iron ore exports –Reclamation of land and installation of infrastructure (1 new stockyard, stacker / reclaimers, conveyors, port buildings, etc.) –Engaging with local public in Environmental Monitoring Committee meetings providing feedback on Environmental and Social process including construction feedback and progress of assessments –Dredging of ~ 7000 m 3 for optimising ship loading and ship position –Drafting of monitoring protocols and supervision of construction and supervision of monitoring during dredging

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Phase 1C –Refurbishment of existing infrastructure to reduce dust emissions (installation of cleaning slabs, condition monitoring, and chute improvement to reduce spillage.) –Improvement of operations to increase throughput from 47 – 60 Million tons per annum through better ship berthing and use of conveyors, stackers/reclaimers and reducing equipment down time –Management of Environmental Assessment process, consultants and applications for licences and permits

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Public Consultation Public consultation as part of the EIA processes Engagement of public through: - Transnet’s normal communication channels - Environmental Monitoring Committees

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Developing a Permitting Strategy Integrate EIA and permitting processes with the life cycle of the project Cross pollination of information and ideas between the engineers and environmental/social team

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–Directed by the Transnet Foundation –Focus on: Rural development & poverty relief in region’s within the Company’s areas of operations Alignment with national Government initiatives Transnet CSR

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Environment, sustainability and community issues are an integral part of the project management. Educate the client (upfront & through out the project) about the process and possible pitfalls and risks. Public Participation - illiterate, no formal education, must inform them in a way that they can participate meaningfully (language, form of communication, training). Integrate permitting processes into the project schedule. Ensure technical information required from engineers for environmental and social specialists is identified early and scheduled. Too much pressure on the authorities can backfire (if not on current project, then the next one) Manage scope changes closely, both with the client and for it’s impact on the environmental and social studies along with the project schedule and cost. Lessons Learned…

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Recommendations for Business Corporations Recognize social, ethical and environmental impacts and have relevant targets Systematic dialogue processes Clear accountability for CSR polices and performance Incentives to achieve social and environmental goals Reporting on the company’s social and environmental performance Internal and external auditing processes that build the credibility and effectiveness of CSR processes and reporting